Ben Colman

I recently saw this metric from Carta’s 1Q24 VC Fund Report, which is very concerning. DPI... is nowhere to be found in earlier vintages that probably should start showing DPI. Funding early-stage projects is great, but ultimately, these venture dollars need to exit their investments and pay back their limited partners. That’s where the metric Distributed to Paid-In Capital (DPI) comes in. While managing a fund, we get interim measures during the life of the fund (e.g. IRR, MOIC), but ultimately, “you can’t eat IRR.” If you want to build a lasting venture capital organization, you need to start showing DPI for your fund. Keep in mind that this is traditional VC data from Carta, and is not strictly crypto venture. Crypto venture tends to get liquidity earlier (tokens) and things tend to go parabolic sooner (faster, more unicorns) - but I’d wager that the data here is somewhat similar for Crypto VCs… Not as much DPI as there should be from these earlier vintages. Read the full article, as well as a recap of all the crypto fundraising rounds for August, here: https://lnkd.in/g3eVJ-iF

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Big announcement below! 👇 Let's talk about the current state of GP-LP affairs: 🤯Emerging VC managers have absolutely exploded over the past 5 years. 📈 At the same time, more and more data has surfaced that shows that emerging VC firms tend to outperform larger, established firms. 🤔 All of this has made it intriguing but tough for LPs to know where to direct their attention. 🛍 GPs frequently meet LPs at conferences who are window shopping but not committed to the asset class or emerging managers. 🧾 And both crews get overwhelmed by transactional convos. So Sydney Paige Thomas and I created Abundance. Abundance is a private, nomination-based retreat for active LPs and top emerging GPs to form new experiences together and build lasting relationships. Why Abundance? Abundance is knowing that there is more than enough for more than one to succeed. And a single win within a community is a win for the community itself. The journey of an emerging VC manager from 1st close to final close or Fund 1 to Fund 2 is (1) communal and (2) requires an abundant mindset. LPs look for structure and confidence to feel comfortable investing in early VC firms. Yet many of the feeds we scroll and conferences we attend reinforce inherent power dynamics and transactional thinking, which allows scarcity mindset to creep in for emerging GPs. Some of the best events I’ve attended have been intentionally non-transactional, e.g. Camp Hustle, Recast Summit, and other GPs’ AGMs. The fundraising success stories we see usually involve a community (usually of other GPs & LPs) coming together to support and open doors for the emerging GP. We designed Abundance to be an immersive gathering that fosters these connections. Starting tonight, ~100 GPs and LPs are descending upon Seattle for the inaugural Abundance retreat. This has been under wraps for months and I can’t wait to see it come to life! Thanks in advance to our awesome sponsors who were the earliest believers in this vision: Sydecar, Amazon Web Services (AWS), Gunderson Dettmer, & Zelda Ventures. And shoutout to my dad Ed Illig for logo design & Halle Kaplan-Allen being the first sponsor to say yes 🤩 Presented by The Council Capital & Symphonic Capital.

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Want a front-row seat to the frontier of tech? We’ve got the role (or two) for you! We’re expanding our frontier-tech team at Blackbird by hiring a Frontier Tech Investments Associate and Foundry Fellows! Got questions? We've got answers... 1️⃣ What are the roles? 🧪 Associate = a full-time VC investment gig in our Blackbird Investments team, working directly with me. We’re looking for someone with a science and/or engineering background and more curiosity than they can handle. You’ll grow your own investment brand and practice, support our portfolio founders, and will help build Foundry, our early-stage frontier-tech accelerator. ✨ Foundry Fellow = a casual/contract gig in our Blackbird Investments team, ~15h per week for 3 months. The Fellowship is ideal for PhD students and ECRs who want to learn more about startups and VC. You’ll go deep on emerging areas relevant to your expertise (or curiosity!), get a front-row seat to groundbreaking companies in those areas, build out your non-academic network, and develop a solid writing practice. 2️⃣ Why are you hiring? We love frontier tech, and we’re ready to grow our team. 3️⃣ Wow, it’s so great that you’re starting to look at deep tech! Look, we get it: we don’t make a lot of noise about our frontier tech investing. Buuuut we’ve been deep-tech investors since we backed Tim Kentley-Klay to found Zoox back in 2014—we’ve been on incredible journeys with PsiQuantum (building the world's first utility-scale quantum computer right here in Australia!), Inventia Life Science (transforming drug discovery with high-fidelity cell models), Remedy Robotics (surgical robots for remote endovascular procedures), Opto Biosystems (minimally-invasive neural implants to treat cancer), and more. We believe that frontier technologies, and great frontier-tech investing, will be part of the solutions to the greatest problems humanity faces today. 4️⃣ When do applications close? May 31st at 11:59pm AEST. 5️⃣ I have more questions! I’m sure you do! Clare Birch and I are hosting an AMA to answer any and all questions about these roles. Want to know what a week in the life of our team looks like? What’s keeping us up at night? What our ideal candidate looks like? Come along and find out - registration link in the comments 👇 Apply for these roles: Associate - https://lnkd.in/gCfj4EUJ Foundry Fellowships - https://lnkd.in/gj6ATZVZ If you know anyone that we should meet, send me their details! Cameron Elise Ben Andrew Robin Joseph Adelaide James Olivia Lucinda Raghav Jesse Christie Mohamed Tom Amee Pablo Haya Loong Hon Joshua Benjamin Megan Harry Denzil Matthew Diana Daniel Tom Deanna Justin Amar Lilly Stone Thomas

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At Forum we look at thousands of deals each year across our Accelerator and Pre-Seed funds but only end up investing in a little over 1% of those startups.  As an early stage VC, I am in the business of saying no to nearly every startup I meet, and while there is nuanced rationale for many of the startups I pass on, a vast majority of businesses that don’t meet the qualification to get funded typically fall into one of two buckets. ▪ First time founders have a tendency to go out to market too early to raise pre-seed capital ▪   I’m sure most founders have heard some iteration of this from VCs that ultimately pass on their business.  In some cases it's a blanket excuse covering up for other pass reasons- perhaps a VC doesn’t believe in a team or isn’t bullish on the market opportunity - but in many cases founders simply haven't proven enough to the market to warrant an investment. I meet many teams with an articulate vision for the product that they want to build, but they either haven't performed enough customer discovery to prove demand for their initial wedge product, or need to raise pre-seed capital to build out an MVP.  In those cases, pre-seed investors are unwilling to underwrite those risks.  To be default fundable, teams need to be able to keep costs low, perform extensive customer discovery, and ship some version of an early product - pilots and early paid customers are key. A huge piece of this is having founding engineering talent on the team. ▪Not every startup is a venture opportunity ▪ By definition, a venture backed business is solving a problem within a market opportunity so massive and so desperately needed, that its growth rate is off the charts.   It spreads like a weed, absorbing almost unlimited amounts of capital to fulfill demand within its customer base.   Each year there are maybe 20 companies launched that ultimately have venture scale outcomes. The bar to reach this rarified air is unfathomably high and the reality is the vast majority of founders simply aren’t building for opportunities that have the potential to be one of these generational companies. Many startup founders view VC as the only viable option for capitalizing their business, but not every great business is a venture business, and most successful founders never take VC dollars.  In order to reach an IPO/acquisition large enough to generate venture returns, a startup needs a credible path to $100s of millions in revenue. This is the standard by which early stage opportunities are evaluated. The flip side to this, and I share this feedback often with founders I meet that are building interesting business in non venture markets, if you are able to scale to $10- $20M in revenue that can be a massively successful outcome for a founder.  There are investors who focus on these type outcomes, namely lower middle market PE shops, and the typical path to those deals is a bootstrapped business or a friends/family capital raise.

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Kettleborough VC has been active for ~6 years, invested in ~30 companies, gone through ~80 funding rounds, witnessed ~12 exits including ~4 instances of partial principal erosion, seen ~4 seed to $100M journeys, tracking ~29% XIRR across the portfolio. A couple of IPOs from the portfolio surely seem very much in line ahead.

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Insightful breakdown from my great Partner Omri Amirav-Drory on the simple factors that really separate the top 1% of investors from the rest, and how more operators should become investors! https://lnkd.in/gEiZdT2h

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A new era of deep tech has emerged. First time funds will raise “unheard of” amounts of capital to fuel next gen deep tech startups - producing outsized, superior returns for LP’s compared to the rest. Prudent investors will act on this data and shift investment strategy as LP’s or risk being left behind savvy wealth managers and CIO’s / FO’s who saw this trend begin 4 years ago.

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Exciting news! We just sent out the inaugural newsletter for Future Frontier Capital, our pre-seed venture fund backing frontier tech startups. As I hit "send," I realized how launching FFC parallels the path of the founders we support. Starting FFC has required the same passion, perseverance, and self-belief that drive entrepreneurs. Just like a startup, getting a VC fund off the ground demands relentless hustle—building the brand, perfecting the pitch, and networking tirelessly. There are constant challenges that test your resolve and endless hours of unglamorous work behind the scenes. And perhaps most daunting - the self-doubt, wondering if you're crazy for attempting something so bold. Pushing through that negative self-talk requires unshakable faith in your mission. Raising this VC fund reminds me of starting our IP strategy and patent analytics firm two decades ago. It’s a powerful reminder of the perseverance, creativity, and resilience needed to turn an ambitious idea into reality. This experience makes us more empathetic partners, ready to support the founders we back. Our work is just beginning, and this inaugural newsletter underscores our commitment to supporting frontier tech startups every step of the way. #startups #VentureCapital #EmergingManagers #Entrepreneurship #InnovationMindSet

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Insightful look into bioplatform strategy, and what it takes to raise a Series A from my partner, Omri Amirav-Drory: https://lnkd.in/dFv7GbF6

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Ross Haleliuk posted the fantastic article below. This is the world where I live day-to-day. At TechOperators, we invest mostly in early-stage cyber, but we do things a little differently, and we believe there are ways to invest successfully outside of pure Power Law math. The article argues that many security problems are too small for VC. I agree. I often try to convince bootstrapped founders not to raise venture because doing so can turn a successful, slow-growing bootstrapped company into a failed venture-backed company because, despite a large infusion of capital, it couldn't double every year. VC is not monolithic--not by stage, strategy, or style. Venture is often equated with "Tier 1 Venture". Ross argues that VC is not always great for early-stage cyber--and he is right. Bootstrapping AND VC work when incentives are aligned. Does it work for an early-stage VC with a <$200M fund to invest in several early companies at reasonable valuations, setting up the conditions for reasonable exits that pay off for both investors and founders? Yes. Does it work for $800M funds investing in seed stage at $100M+ valuations? Well, that depends! Power law says it does (for VC), but the unfortunate externality is that these rounds destroy companies and founder equity more often than not. There is a role for patient capital in this ecosystem to fuel successful companies that retain exit optionality as they scale--driving exit value for both founders and investors.

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💡Benchmarks in the investment industry serve as a standard for measuring the performance of securities, mutual funds, or investment managers. They provide a reference point for analyzing allocation, risk, and return of a portfolio, enabling investors to make informed decisions. Thanks Peter Walker for keeping us all informed!! Can’t wait for this!! Follow and get on the waitlist for this one! #benchmarks #fundraising #Capitalraise #founders #womenshealth #femhealth #medtech #wellness

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What do you do when a radical new technology puts your main product right in the crosshairs of disruption? Listen to David Okuniev — co-founder of Typeform | Ask awesomely — discuss the challenges of innovation within existing structures. David shared a game-changing insight: Radical innovation is really, really difficult to do inside your own product. He emphasized the need to break free from the constraints of familiarity and embrace change from outside the box. Henrik Werdelin and I have both seen our fair share of this in our respective careers. What struck us most was how David leveraged structure to overcome the innovator’s dilemma. By creating a culture of experimentation and providing space for bold ideas, he propelled Typeform beyond incremental improvements. What other hacks have you seen or employed to help your organization overcome the innovator’s dilemma? Share your stories below! 👇 And if you want to dive deeper into our conversation, click the link in the comments to catch the full podcast episode!

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The state of venture capital is wild right now. We are witnessing a surge of innovation across the spectrum: - Funds merging - VC doing PE - PE doing VC - Secondary funds - Buyout funds - Spin-out funds - Debt funds - Continuation funds - Infrastructure funds - GP turnover - Hard Tech surging - Family Office uptick

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Aven recently raised a $142M Series D at a $1 billion valuation. Khosla Ventures and General Catalyst led the round with participation from existing investors including Caffeinated Capital, Electric Capital, Founders Fund, and The General Partnership. Aven grew ~3x over the last year and claims to have saved customers $100M in interest. Aven also launched an advisor product that has 160,000 members but there’s limited information for this product. Aven offers a HELOC (Home Equity Line of Credit) Credit Card that combines the benefits of a traditional credit card with the advantages of a home equity line of credit. Product Details: - Credit Line Amount: up to $250,000 - Annual fee: None (and no notarization fee) - Interest Rate Range: 7.99% - 15.49% (variable) - Max APR: 18% - Rewards: 2% cashback, 7% on travel booked through Aven travel portal - Autopay discount: 0.25% - Late fees: $29 - Approval time: as less as 5 mins - Partner bank: Coastal Community Bank - Network: Visa Portfolio: - Total cardholders: 33,000 - Total Credit Line: $1.5B - Based on this, the average credit line amount is $45,454.54 (~$50,000). - Outstanding balance: $525M - Avg Interest Rate: 11.74% - Annualized Gross Revenue: $525M * 11.74% = $61.63M Assuming the cost of capital is 7.5% (SOFR + 2%), Aven nets 4.25%. If Aven is netting 1% servicing fee, their total net revenue is $27.56M = $525M * (4.25% + 1%) At the current revenue run rate, Aven is valued at ~40x net revenue. For comparison, below is the TTM revenue and market cap for a few public companies: - SoFi: $3.21 billion (revenue), $7.90 billion (market cap), 2.46x - Onemain: $4.28 billion (revenue), $6.13 billion (market cap), 1.43x - Robinhood: $2.07 billion (revenue), $20.57 billion (market cap), 9.9x - Upstart: $538.43 million (revenue), $2.44 billion (market cap), 4.53x - Ally: $8.10 billion (revenue), $12.72 billion (market cap), 1.57x Additional services Aven could provide: - Auto-backed Cards: Aven can also offer cards backed by cars. These loans would be smaller but the customer will be on the lower end of the credit spectrum. - Mortgage Refinancing: Aven’s current relationships could be a way to offer mortgage refinancing (rates are expected to come down and mortgage refinancing is expected to grow). - Insurance and other home ownership products: Aven could sell high margin products needed by homeowners like insurance. - Student Loan Refinancing: Many customers may have student loans that Aven or their partners could refinance. - Home Services Subscriptions: New options for homeowners could include a concierge for their home services. It can be a marketplace of vetted providers for home services and improvements. Aven is building a strong and captive customer base. Once it has enough customers, it can sell multiple financial products and continue to increase the LTV of its customer base. Higher retention and strong cross-sell will define the success of the business.

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